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slega [8]
3 years ago
8

The Taffy Trust is a simple trust. Sean is its sole beneficiary. In the current year, the trust earns $12,000 in taxable interes

t and $30,000 in rental income. In addition, the trust recognizes a $4,000 long-term capital gain and $1,100 long-term capital loss. The trustee assesses a fee of $6,500 for the year. Depreciation related to the rental property is $2,800.
a. If the trust agreement allocates fees, depreciation, and capital gains and losses to corpus, trust accounting income is $
b. However, if the trust agreement allocates one-half of the fiduciary's fees as well as all of the capital gains and losses to income, the trust accounting income is $
Business
1 answer:
algol [13]3 years ago
3 0

<u>Solution and Explanation:</u>

a. <u>Accounting income is computed below: </u>

Taxable interest 12,000.00

Rental income 30,000.00

Long term capital gain 0.00

Long term capital loss 0.00

Fees 0.00

Less: depreciation -2,800.00

Trust accounting income 39,200.00

<u>b.</u> One half of fiducary's fee = 6500 divided by 2 = 3250. This amount will be allocated to accounting income of the trust.

Taxable interest 12,000.00

Rental income 30,000.00

Long term capital gain 4,000.00

Long term capital loss -1,100.00

Fees -3,250.00

Depreciation -2,800.00

Trust accounting income 38,850.00

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Shelly has $200,000 of QBI from her local jewelry store (a sole proprietorship). Shelly's proprietorship paid $30,000 in W–2 wag
natka813 [3]

Answer:

Qualified Business Income (QBI) Deduction:

With respect to the applicable provisions, the following are the provisions relating to QBI deduction:

(a) For Joint filers, if the taxable income is less than $315,000, the QBI deduction is limited to 20% of the qualified business income.

(b) The qualified business income includes the interest income not allocable to the business.

In the present case, the interest amount of $20,000 will not be considered for the calculation of QBI deduction (refer point (b) above).

Therefore, the total taxable income of S and her spouse will be $274,400 ($200,000 + $74,400) which was below the threshold limit of $315,000. Hence, they can claim the QBI deduction of 20% on the qualified business income of $200,000. The QBI deduction for 2018 is calculated as under:

QBI Deduction for 2018 = QBI x 20%

= $200,000 x 20%

= $40,000

Therefore, the QBI deduction for 2018 is $40,000.

Note: If the total taxable income exceeds the threshold limit of $315,000 for QBI deduction, the value of W-2 wages and qualified property would have been considered.

5 0
3 years ago
UPS, a delivery services company, has a beta of 1.1, and Wal-Mart has a beta of 0.7. The risk-free rate of interest is 4% and th
Brrunno [24]

Answer:

7.78%

Explanation:

Calculation for the expected return on a portfolio

First step is to calculate the portfolio beta

Portfolio beta=30%*1.1+30%*0.7=1.15

Portfolio beta=0.33+0.21

Portfolio beta=0.54

Now let calculate the expected return using this formula

Expected return=rf+(Portfolio beta*mrp)

Let plug in the formula

Expected return=4%+(0.54*7%)

Expected return=7.78%

Therefore the expected return on a portfolio is 7.78%

7 0
2 years ago
Suppose you own a small business and have been thinking about expanding production, including hiring more workers. Until recentl
disa [49]

Answer: Economic Growth, Employment opportunities, Standard of living improvement.

Explanation:

Macroeconomics is a branch of economics that deals with the structure, performance, behavior, and the decision-making of the economy as a whole. It includes the regional, national, and the global economies.

Expanding production will help the economy in the following ways:

1. Provision of employment opportunities: An increase in production will lead to more goods and services being offered. This will in turn, lead to more workers who would be needed for production.

2. Increase in standard of living: There will be an increase in the standard of living for people that were not employed before and now gainfully employed due to the expansion.

3. Economic growth: Economic growth is the increase in the goods and services in the economy. Increase in production will enhance economic growth.

6 0
2 years ago
Costco is able to keep costs down and offer low prices thanks to a no-frill shopping experience for its 64 million members. They
34kurt

Answer:

Costco is following Customer Oriented Strategy in the business.

Explanation:

Costco offers around 4000 different products to its 64 million members. Costco is now planning to stock more of organic products as the popularity for these products among its customers in gaining significance. Costco has also planned to help farmers to grow organic farms which will benefit the Costco customers. This is customer oriented strategy because Costco is focusing on the needs of its customers.

7 0
2 years ago
Martin is the daytime supervisor for a packaging assembly line. He supervises 38 workers who perform routine jobs that require m
nadya68 [22]

Answer: E. Martin likes to provide the guidance and support needed by employees and ties meaningful rewards to accomplishment of objectives.

Explanation: Path-goal model of leadership is said to be a theory based on a specify leader behavior that best suit his employees and the work environment that would help achieved set goals. The main aim of path-goal model of leadership is to increase employees morale, motivate and empower them.

Martin is following this model to provide the needed guidance and support the employee working under him requires.

6 0
3 years ago
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